Further 16-18 apprenticeship funding rate reduction

The government is proceeding with plans to reduce the national funding rate for 16 to 18 apprenticeships by another two per cent next year, despite under-spending by £15m in 2010/11.

The rate reduction comes as youth unemployment continues to break records, which for 16 and 24 year-olds increased by 52,000 during the three months ending in November 2011, hitting a staggering 1.04 million.

We regret this proposed reduction and it probably needs to be looked at again in the context of  the recent announcement about a minimum one-year duration for 16-18 apprentices,”

A spokesperson for the Skills Funding Agency (SFA) said: “The YPLA announced in its 16-19 Funding Statement in December 2011 that the national funding rate for 16-18 Apprenticeships will be reduced by two per cent in 2012/13. At the end of  March, the Agency will publish the Funding Rules for 2012/13, which will include the national funding rates.”

The Association of  Employment and Learning Providers (AELP) said the reduction would cause a “tension” between quality and volume.

“We regret this proposed reduction and it probably needs to be looked at again in the context of  the recent announcement about a minimum one-year duration for 16-18 apprentices,” an AELP spokesman said. “There is universal agreement that young people should be receiving quality training on an apprenticeship and quality provision comes at a cost. Therefore when the government is trying to grow the number of  young people starting apprenticeships, a rate cut could create a tension between increasing volumes and maintaining quality.”

The national funding rate for apprenticeships aged between 19 and 24, as well as 25 and over, will remain unchanged in 2012/13. The SFA has also revealed “the under spend on the 2010/11 financial year for 16-18 apprenticeships was £15 million, which represented less than two per cent of  the budget.”

Gordon Marsden MP, shadow minister for FE, has called on the government to increase the number of  apprenticeships for young people at small and medium sized businesses.

He said: “Apprenticeships have a key role in play in providing new opportunities for young people and boosting growth across the regions. For all the government’s rhetoric on apprenticeships, they are still failing to create enough places for young people, while many smaller sized businesses feel unable to take part.”

Proposals by Labour include redirecting money from the Growth and Innovation Fund into a new ‘Apprenticeships Innovation and Collaboration Fund’, designed to encourage smaller firms to take on a young apprentice.

John Hayes MP, minister for further education, skills and lifelong learning, has said he will “focus” on improving apprenticeships for people aged 16 to 24. Mr Hayes, speaking at an apprenticeships debate in the House of  Commons last month, said: “It is important that we focus apprenticeships on where they are of  most value, and there is more evidence to suggest that they are of  most value to young people between the ages of  16 and 24; and, secondly, it is important that we are relentless in our drive for quality.”